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Taiwan manufacturing PMI falls sharply in October

TOKYO-- Taiwanâs manufacturing sector in October contracted for the first time in more than two years, as weaker demand conditions led companies to lower output, according to a survey.

The Nikkei Taiwan Manufacturing Purchasing Managersâ Index, or PMI, fell from 50.8 in September to 48.7 in October, falling below the 50-point line separating expansion from contraction for the first time since May 2016.

October saw steep contractions in both output and new orders, with export orders falling solidly. The lower production requirements prompted a renewed fall in buying activity among Taiwanese manufacturers.

Sentiment also turned negative for the first time in more than two years âwith a number of companies anticipating the ongoing China-US trade dispute to weigh on the sectorâs performance going forward,â said Annabel Fiddes, Principal Economist at IHS Markit, which compiles the survey.

The declining trend in purchasing activity âsuggests that output levels may not improve in the near-term,â Fiddes added.